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  • UOB Ups Stake in Troubled Chinese Lender

    UOB Ups Stake in Troubled Chinese Lender

    United Overseas Bank is buying more shares in troubled Chinese mid-sized lender Hengfeng Bank with a subscription of 1.86 billion shares for a sum of 1.86 billion yuan (S$360.4 million).

    The purchase comes as part of a capital-increase exercise undertaken by Shandong-based Hengfeng Bank through private placement to raise 100 billion yuan. The move reverses a stance taken in May, where local newspapers reported that United Overseas Bank (UOB) had wanted to sell its 13 percent stake in Hengfeng Bank, which it purchased back in 2008.

    The initial intention of UOB was to grow its presence in Shandong with more of its own branches. This time, the increased shares are in line with United Overseas Bank (UOB)’s «focus on driving regional connectivity and building ecosystem partnerships to facilitate business and investment opportunities opening up across the region,» according to a filing on the Singapore Exchange.

    Funding the subscription of additional shares in cash using internal resources, UOB said the subscription is not expected to have a material impact on earnings or net tangible assets of the group for the current financial year. Post the transaction, UOB will hold a total of 3.34 billion shares in Hengfeng Bank.

    The majority of the shares, or 96 billion, will be subscribed by Chinese state-owned investment company Central Huijin Investment and Shandong Financial Asset Management Co, to become controlling shareholders of the bank, as part of state rescue efforts to prop up floundering lenders as the Chinese economy slows.

    Concerns about private company debts in the region have risen in recent months with the default or near-default of six private companies in Shandong. Banks affected by defaults could see more capital raising exercises.

    UOB explains that the collaboration with Hengfeng Bank will help businesses benefit from Shandong’s economic progress and financial liberalization, and is in tandem with the partnership between Singapore and Shandong to promote business flows into South-east Asia with Singapore as a regional hub.

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  • Hong Kong’s First Virtual Bank Launches

    Hong Kong’s First Virtual Bank Launches

    Hong Kong’s banking history enters a new chapter with the launch of its first virtual lender, ZA Bank.

    ZA Bank, co-owned by ZhongAn Online P&C Insurance and Sinolink Group, launched yesterday to become the first virtual bank to kickstart services in Hong Kong. According to its chief executive Rockson Hsu, the name «ZA» represents a reversal of alphabetical order which is a reminder to «think out of the box and view things from a different perspective».

    It’s good to be bold, contrarian and creative, Hsu added in a statement.

    ‘Z’ and ‘A’ also means ‘end-to-end’, it symbolizes our mission to redefine customer journey through technology, from the front-end (mobile app/branch), mid-office (customer service/operation department) to the back-end (operating system), from product development to service process.

    ZA Bank said it would offer interest rates of 1.4 percent for one-month Hong Kong dollar deposits and up to 2 percent for three, six and 12-month deposits.

    Whilst this lags behind traditional lenders in Hong Kong which offer up to 2.2 percent on 12-month deposits, ZA Bank’s minimum size of $1 falls very much well below traditional minimum deposit sizes of HK$10,000. ZA also provides time deposits for U.S. dollars and yuan.

    ZA Bank will initially only roll-out services such as remote account opening, multi-currency savings account, time deposits, local transfers and e-statement services only to a select handful of 2,000 users which include friends and relatives of its staff.

    The launch falls under the HKMA’s sandbox mechanism and once the pilot is deemed successful, services will be made accessible by the general public.

    We are delighted to note that the first virtual bank has started its trial run today in the HKMA’s Fintech Supervisory Sandbox, thanks to the diligent efforts of various parties, said Arthur Yuen, Hong Kong Monetary Authority’s deputy chief executive, in a separate statement.

    We believe that as virtual banks gain a better understanding of their customers’ preferences and habits over time, they will leverage financial technologies to offer more personalized products and services, and new user experience to customers.

    Seven other virtual banks in Hong Kong are expected to launch in the first half of next year.

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  • StanChart Makes Good on Climate Change Fight

    StanChart Makes Good on Climate Change Fight

    Standard Chartered recently announced its commitment to combat climate change with real and substantial anti-coal financing policies and even exited three controversial power plant deals.

    Standard Chartered Group will only support clients who actively transition their business to generate less than 10 percent of earnings from thermal coal by 2030, according to a statement. The business will adapt to this commitment on a phased basis beginning on January 1, 2021.

    We are taking bold and ambitious actions in support of the Paris Agreement, being the first bank active in emerging markets to confirm that we will be out of thermal coal by 2030 and set a massively increased target for helping our clients transition into low-carbon technologies,» said Bill Winters, group chief executive of Standard Chartered.

    The bank announced an increased target to finance $35 billion by 2025 in deals linked with clean technology and renewable with a particular focus on emerging markets.

    According to the bank, emerging markets across Asia, Africa and the Middle East not only have an opportunity to «leapfrog to new low-carbon technology» but face insufficient financing, citing the U.N. figure of a $2.5 trillion per year funding gap.

    The statement accompanied a release of a Taskforce on Climate-related Financial Disclosurs (TCFD) report on the bank’s progress with aligning its lending portfolio to Paris Agreement goals of limiting global warming to significantly below two degrees.

    Of the moves announced towards supporting renewable energy, the boldest deliverable was the bank’s decision to withdraw from three projects it had said it would finance in September 2018 – assumed to be Vung Ang 2 and Vinh Tan 3 in Vietnam, alongside Java 9 and 10 in Indonesia.

    Prior to the withdrawal from the deal, Standard Chartered was lambasted by environmental campaigners that challenged the credibility of the bank’s leadership position in «Equator Principles». A Banktrack executive likened the matter to «putting the fox in charge of the hen house».

    Standard Chartered’s latest move should send a signal to other banks, including DBS, that building coal is financially risky, environmentally and socially unsound and morally reprehensible,» said Bernadette Maheandiran, a legal analyst from Market Forces.

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  • UBS Reworks Super-Rich Unit

    UBS Reworks Super-Rich Unit

    UBS continues to tussle with how to cater to the lucrative super-rich tier: the bank is planning changes for the $1 trillion business led by top banker Josef Stadler.

    The Swiss-based wealth manager is whittling its ultra-high net worth business, a move which will dramatically curb the influence of unit head Josef «Joe» Stadler, a source familiar with the matter said. 

    Specifically, UBS will disperse some of its super-rich and family office clients back into the regions, the person said. Stadler will maintain a percentage of the total clients and take over an as-yet-unnamed new unit, they said.

    The so-called ultra-high net worth unit is at the center of UBS’ private banking play. The move is the first to emerge since a sixty-day «grace period» imposed on new unit co-head Iqbal Khan by CEO Sergio Ermotti lapsed. Khan runs UBS’ $2.3 trillion wider wealth management arm, together with Tom Naratil.

    The 43-year-old Khan «doesn’t care for too many segments,» the person familiar with the move said. In practice, this means that simply being super-rich won’t get you the free shmoozing and perks that are common in wooing this segment, the person said.

    Largest Wealth Custodian?

    While the super-rich segment has won substantial new funds, UBS frets that not all of it is as lucrative as it hoped – some clients use UBS solely for trading or execution, which isn’t a lucrative business for the bank.

    Khan is battling against UBS becoming the world’s largest custodian of assets – as opposed to an active wealth manager, earning fees and commissions based on its advice.

    In the future, clients will only command the luxe service if they truly draw the sophisticated (and pricey) services that UBS wants to put at their disposal. The reversal undermines Stadler, who had emerged as hugely influential in a mega-merger, overseeing more than $1 trillion in assets at the end of last year.

    Most notably, Stadler and his team won entry into the U.S. wealth market, where UBS is scaling its way up the ladder in a bid to win wealthier clients and families with least $50 million). Stadler launched a U.S. capital markets team for the super-rich push under long-time investment banker Reinhardt Olsen several months ago.

    But Stadler’s efforts are constantly accompanied by turf wars: he clashed over territory with Europe boss Christine Novakovic. The reorganization in the super-rich segment hands considerable influence back to Novakovic, to Asian wealth co-heads Amy Lo and August Hatecke, and to U.S. boss Jason Chandler.

    UBS plans to cut as much as 5 percent of staff as a result of the move, «Inside Paradeplatz» reported, citing bank insiders. Stalder oversees more than 1,000 private bankers. The segment is the second-costliest to operate, after the Americas: its cost-income ratio is 76 percent, just under the wider private bank’s 77 percent total in the third quarter.

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  • HSBC Nets Bankers From UBS and Credit Suisse

    HSBC Nets Bankers From UBS and Credit Suisse

    HSBC Private Bank appointed four senior executives to strengthen the key areas of family advisory services and philanthropy within the Private Wealth Solutions business in Asia Pacific.

    As part of its push to grow its private banking business in the Asia Pacific, HSBC announced four senior hires on Monday. Aik-Ping Ng joins as Co-Head of Family Office Advisory and Senior Family Governance Advisor, Asia Pacific while Edith Ang will be Co-Head of Family Office Advisory and Senior Family Governance Advisor, Asia Pacific, the bank said in a media statement on Monday.

    Both of them will work with client families to develop long-term succession plans, which includes providing the highest standard of advisory on establishing and professionalizing family offices, trusts and estate planning, family governance and preparing for the transition of responsibility to the next generation.

    Aik-Ping Ng has over 17 years of international and China-based experience in private equity, corporate finance, strategic M&A, family office advisory and asset management to HSBC. Most recently, Ng was a Senior Advisor at UBS, working with Ultra High Net Worth (UHNW) clients in the formulation, review, and implementation of family office solutions.

    Edith Ang joins HSBC after 13 years at UBS, where she worked with UHNW families in Asia on the formulation, review, and implementation of family legacy solutions.

    In addition, Dorothy Chan has been appointed to be Head of Philanthropy Advisory and Charitable Services, Asia Pacific, while Christine Wong will take up the role of Head of Greater China Market, Private Wealth Solutions. Dorothy Chan succeeds Cynthia D’Anjou-Brown, the previous head, as the latter will retire from HSBC in December this year after almost 15 years of service.

    As a leading private and institutional client trustee platform, we are dedicated to building lasting relationships with HNW and UHNW families to identify the solutions to support them across the generations,» said Cynthia Lee, Regional Head of Private Wealth Solutions, the Asia Pacific in a media statement.

    Dorothy Chan joins HSBC after 19 years of experience in a variety of senior roles in the private, public and not-for-profit sectors. She previously worked at Galaxy Entertainment as Vice President, Corporate Relations. Chan has deep experience working with a number of leaders to define a vision and create solutions that contribute to the sustainable development of a range of diverse communities.

    Working closely with HSBC’s teams in EMEA and the Americas, Chan will help drive coordinated philanthropy efforts including building charities and connecting. She will also lead the team supporting clients in the development of their charitable goals.

    Christine Wong joins HSBC from Credit Suisse, where she was Director of Trust and Estate Advisory Team for the Greater China Market. Prior to joining HSBC, she gained 25 years of experience in cross-border trusts in senior wealth planner roles at Credit Suisse, Edmond de Rothschild, UBS, and J.P. Morgan.

    She also has served as Managing Director of the Asiaciti Trust group’s Hong Kong office with responsibility for the fiduciary management and trust operations of the business. In her new role, Christine Wong will be integral to the further development of HSBC’s Private Wealth Solutions business in Greater China.

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  • HSBC Nets Bankers From UBS and Credit Suisse

    HSBC Nets Bankers From UBS and Credit Suisse

    HSBC Private Bank appointed four senior executives to strengthen the key areas of family advisory services and philanthropy within the Private Wealth Solutions business in Asia Pacific.

    As part of its push to grow its private banking business in the Asia Pacific, HSBC announced four senior hires on Monday. Aik-Ping Ng joins as Co-Head of Family Office Advisory and Senior Family Governance Advisor, Asia Pacific while Edith Ang will be Co-Head of Family Office Advisory and Senior Family Governance Advisor, Asia Pacific, the bank said in a media statement on Monday.

    Both of them will work with client families to develop long-term succession plans, which includes providing the highest standard of advisory on establishing and professionalizing family offices, trusts and estate planning, family governance and preparing for the transition of responsibility to the next generation.

    Aik-Ping Ng has over 17 years of international and China-based experience in private equity, corporate finance, strategic M&A, family office advisory and asset management to HSBC. Most recently, Ng was a Senior Advisor at UBS, working with Ultra High Net Worth (UHNW) clients in the formulation, review, and implementation of family office solutions.

    Edith Ang joins HSBC after 13 years at UBS, where she worked with UHNW families in Asia on the formulation, review, and implementation of family legacy solutions.

    In addition, Dorothy Chan has been appointed to be Head of Philanthropy Advisory and Charitable Services, Asia Pacific, while Christine Wong will take up the role of Head of Greater China Market, Private Wealth Solutions. Dorothy Chan succeeds Cynthia D’Anjou-Brown, the previous head, as the latter will retire from HSBC in December this year after almost 15 years of service.

    As a leading private and institutional client trustee platform, we are dedicated to building lasting relationships with HNW and UHNW families to identify the solutions to support them across the generations, said Cynthia Lee, Regional Head of Private Wealth Solutions, the Asia Pacific in a media statement.

    Dorothy Chan joins HSBC after 19 years of experience in a variety of senior roles in the private, public and not-for-profit sectors. She previously worked at Galaxy Entertainment as Vice President, Corporate Relations. Chan has deep experience working with a number of leaders to define a vision and create solutions that contribute to the sustainable development of a range of diverse communities.

    Working closely with HSBC’s teams in EMEA and the Americas, Chan will help drive coordinated philanthropy efforts including building charities and connecting. She will also lead the team supporting clients in the development of their charitable goals.

    Christine Wong joins HSBC from Credit Suisse, where she was Director of Trust and Estate Advisory Team for the Greater China Market. Prior to joining HSBC, she gained 25 years of experience in cross-border trusts in senior wealth planner roles at Credit Suisse, Edmond de Rothschild, UBS, and J.P. Morgan.

    She also has served as Managing Director of the Asiaciti Trust group’s Hong Kong office with responsibility for the fiduciary management and trust operations of the business. In her new role, Christine Wong will be integral to the further development of HSBC’s Private Wealth Solutions business in Greater China.

  • China Wants Macau as Financial Hub

    China Wants Macau as Financial Hub

    Beijing has directed state-owned banks and enterprises to help set up infrastructure in Macau to aid financial diversification, and to serve as a contingency plan if the situation in Hong Kong worsens.

    Two officials who helped develop the Shanghai stock exchange moved to Macau to help establish its yuan-based stock exchange, one of the sources told «Reuters». Chinese officials, and bankers in Hong Kong, say the push to develop financial infrastructure in Macau is part of a plan to avoid any major market disruption in Hong Kong that could impact Chinese businesses.

    The financial industry used to be an idea that we reserved for Hong Kong. We used to give all the favorable policies to Hong Kong. But now we want to diversify it, said one Chinese official who requested anonymity.

    The idea is not for Macau to replace or undermine Hong Kong but for China to have a contingency plan in case the situation in Hong Kong worsens, sources at Reuters added.

    The slew of new policies for Macau is aimed at diversifying the city’s casino-dependent economy into a financial center. Macau’s casino operators, which have been hit by slowing economic growth and the Sino-U.S. trade war could look forward to the development opportunities in Hengqin, casino executives who were interviewed said.

    Xi Jinping has made very clear that he wants a diversified Macau economy, said one Chinese official. The future focus will be on tourism and finance, to make it a center to host international meetings like Singapore.

    Besides establishing a yuan-denominated stock exchange and speeding up a yuan settlement center which is currently being developed, the policies will also be looking at land allocation in Macau. As part of that effort, Macau will be allocated more land on the mainland island of Hengqin to develop in areas such as education and healthcare.

    These policies also mark the 20th anniversary of the former Portuguese colony’s return to Chinese rule, as Xi plans a visit to Macau next week. There, Xi is expected to announce policies to further integrate Macau with mainland cities in the Greater Bay Area, the region around the Pearl River Delta that also includes Hong Kong, according to Chinese officials and Macau executives.

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  • Apple Card holders can buy an iPhone and make 24 monthly interest-free payments

    Apple Card holders can buy an iPhone and make 24 monthly interest-free payments

    Sure, Apple iPhone buyers can purchase an iPhone from their carrier and pay it off interest-free by making 24-monthly payments. Starting tomorrow, that option will be available to Apple Cardholders purchasing a new iPhone from the Apple Store. The monthly amount owed for the phone will be added to each month’s minimum amount due for 24 months. Cardholders using the Apple Card to make purchases at the Apple Store will receive a 6% cashback bonus until the end of this year. That is twice the usual 3% that they get back on Apple Store purchases made with the card.

    Apple CEO Tim Cook, after Apple reported its fiscal fourth-quarter results in October, announced that the company was going to allow Apple Cardholders to pay for iPhone purchases monthly. At the time, Cook said, “One of the things we are doing is trying to make it simpler and simpler for people to get on these sort of monthly financing kind of things. That’s a part of what we announced with the Apple Card earlier in the call and so we are cognizant that there are lots of users out there that want sort of a recurring payment like that.”

    The company does offer the iPhone Upgrade Program, which includes 24 interest-free monthly payments for an iPhone bundled with the AppleCare+ extended warranty. After 12 monthly payments, the iPhone being paid off can be exchanged for the latest model and the payments continue. For example, those signed up for the upgrade program are paying $54.08 monthly for the 64GB iPhone 11 Pro Max.
    Apple posted a message about installment payments inside the Wallet app on Monday that read “Installments are not subject to interest like other purchases made with Apple Card. If you pay more toward your installment balance, you may reduce the overall number of payments, but are still scheduled to pay your installment payment the following month.” The tech firm introduced the Apple Card in March and launched it in August. The card is the result of a partnership between Apple and securities firm Goldman Sachs. In addition to receiving 3% back on purchases of Apple products using the card (as we pointed out earlier, until the end of the year this is doubled to 6% for Apple Store purchases), users get a 1% cash back bonus on purchases while Apple Pay transactions give users back 2% of the amount charged. These cashback payments are computed and added to the user’s account daily. And there are no fees for Apple Cardholders; Apple does not collect late fees, annual fees, or over-the-limit fees.
    Apple iPhone users can apply for the card through the Wallet app or from the Apple Card site. And once they are approved, the card can be used immediately using Apple Pay and the Wallet app. While those approved can use the card immediately, a physical titanium card is subsequently mailed to the account holder. And while most credit card companies clap their hands together in glee and drool when customers pay the minimum amount due each month, Apple will show users how much interest they can expect to pay overtime based on the amount they are paying each month. This might give cardholders the incentive to pay down more of their balance each billing cycle.
    With the Wallet app, users can see their account as it stands right at that moment. And if a subscriber spots a charge that he or she doesn’t remember, tapping on it will show the location where the transaction took place on a map.
    So if you have an Apple Card, starting tomorrow, you can purchase a new iPhone from the Apple Store and make 24 monthly installment payments interest-free; there’s no additional application required to finance the purchase of an iPhone using the card.
  • Tencent’s WeBank to Power China’s Blockchain Network

    Tencent’s WeBank to Power China’s Blockchain Network

    The Shenzhen-based firm will provide the tech for the country’s national blockchain consortium. WeBank, China’s first digital bank, will provide the technical infrastructure for the country’s nationwide blockchain-based service network (BSN), according to a Chinese state media report.

    BSN plans to offer infrastructure services for any Chinese or international entity that uses blockchain. According to the agreement, BSN will use WeBank’s open-source FISCO BCOS blockchain application ecosystem, and WeBank will provide technical support and training for BSN developers, the report said.a

    China is attempting to build a nationwide blockchain network to serve a range of state-controlled public services across the country, including telecommunications and energy management.

    Users in various industries often face dilemmas such as high cost of forming a chain, heterogeneity of the underlying platform, and inability to interact with data. Promoting the construction of public infrastructure at the bottom of the blockchain has become the meaning of pursuing the development of the digital economy, the report said.

    Led by the State Information Center, a think tank affiliated with the National Development and Research Commission, China’s highest central planning agency, the BSN consortium includes firms like WeBank, Huobi China, UnionPay, China Mobile and China Telecom.

    The project has been tested in 25 cities across China as well as Hong Kong and Singapore. It is expected to be tried out in more than 200 cities by 2020.

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  • Broking Pressures Prompt Cuts at Maybank Kim Eng

    Broking Pressures Prompt Cuts at Maybank Kim Eng

    The job cuts are part of a broader review that also affects Maybank Kim Eng’s regional institutional sales and research, and Hong Kong investment banking and advisory businesses.

    Maybank Kim Eng (KE), the investment banking arm of Maybank, is restructuring its retail brokerage operations, and 5 percent of its staff in Singapore, or about 30 people, are being laid off, the firm said in an internal memo circulated.

    About 3 percent of its global workforce of 2,000 are affected by the latest exercise. The firm has about 600 employees in Singapore, which includes 400 full-time staff and self-employed remisiers, though none of the latter were affected, «BT» reported. Back office staff are among those being let go.

    The restructuring was prompted by changes in the investment banking landscape, including shifting customer preferences, increasing automation and digitalization of brokerage offerings, and changes in the regulatory environment, a spokesperson told the newspaper in a statement.

    Lower trading commissions and the growing popularity of passive investing with robo-investors are putting a strain on securities brokers like Maybank KE, which reported a pre-tax loss of 7.3 million ringgit ($1.75 million) for the first nine months of 2019, compared to a pre-tax profit of 227.4 million ringgit for the same period last year.

    Singapore, however, continues to be the firm’s largest market outside its home base Malaysia. Maybank KE is the city-state’s 15th-largest broker, with a 3.38 percent market share.

  • UBS Optimus Foundation Launches Singapore Office

    UBS Optimus Foundation Launches Singapore Office

    UBS Optimus Foundation has established its first office in the city-state to expand its philanthropic offerings to clients in Asia. This is the foundation’s seventh office worldwide and third in Asia, after Hong Kong and Beijing.

    UBS said the Singapore office will engage the bank’s clients on philanthropic activities related to health, education and the protection of children, as well as sustainable and environmental causes. The foundation, which counts as one of the world’s largest international donors in China, supports over 200 programs around the world that are worth more than 200 million Swiss francs (S$274.5 million).

    Philanthropy and sustainable investing are an increasing focus of our clients in the region, many of whom are seeking investment opportunities in sectors including healthcare, oncology, and affordable education, said August Hatecke, co-head of UBS Wealth Management Asia-Pacific and the country head of UBS Singapore in a media statement on Monday.

    To mark the launch of the new office, UBS employees in Singapore raised a sum exceeding S$100,000 which, together with matching contributions from UBS, will fund the foundation’s first program in Singapore. Last year, the UBS Optimus Foundation raised 65 million Swiss francs (S$89.2 million) and committed to 92 new programs to reach out to close to 3 million children.

    We expect unprecedented amounts of wealth in Asia to be transferred across generations over the next 20 years. This will be a significant boost on philanthropy as many entrepreneurs are committed to using their wealth to create a legacy that has a positive social impact, said Desmond Kuek, the chairman of the UBS Optimus Foundation Singapore.

  • Vietnam second among ASEAN members in attracting fintech funding

    Vietnam second among ASEAN members in attracting fintech funding

    Vietnam’s fintech firms secured $410 million, or 36 percent of the global capital pouring into Southeast Asia between January and September, behind Singapore.

    The country’s share of regional venture capital funding devoted to fintech soared from just 0.4 percent in 2018, according to a report prepared by the United Overseas Bank (UOB), PwC and the Singapore Fintech Association (SFA).

    Singapore remained the top destination for regional fintech investment, with 51 percent, down from 53 percent in 2018, with Indonesia in third place with 12 percent, down from 37 percent last year.

    ASEAN Fintech Funding 2019PercentageSingaporeVietnamIndonesiaOthersSource: Tracxn

    By the end of the third quarter this year, ASEAN had received $1.14 billion in funding for fintech firms, up sharply from $35 million in 2014, the report said.

    The surge in investments in Vietnam this year is attributable to two large deals, both in digital payments. In July, digital payment firm VNpay received $300 million in investment from Japanese multinational conglomerate SoftBank and Singaporean sovereign wealth fund GIC.

    And in January, e-payment app MOMO Pay landed $100 million from investors led by American private equity firm Warburg Pincus in its Series C funding round. The two deals accounted for 98 percent of Vietnam’s total fintech funding in the first nine months.

    In terms of the number of funding deals in 2019, Vietnam came third in ASEAN at 8 percent of total deals, up from 2 percent in 2018, behind Singapore and Indonesia with 51 percent and 28 percent respectively.

  • UBS and Credit Suisse Rediscover Their Clients

    UBS and Credit Suisse Rediscover Their Clients

    UBS and Credit Suisse have courted the richest of the rich for many years – it became an end in itself. Now, the signs are that a rethink is underway.

    The two big banks have not been shy to show off their efforts to cater to ultra-rich clients, hoping to attract even more of what they claim is a lucrative business.

    Despite the fact that margins take a nosedive when banking with demanding clients, investors were told that the ultra-high net worth (UHNW) segment was lucrative and more stable than other segments. The investment banks are depicted as a competitive advantage for uber-rich clients to use their infrastructure for complex transactions.

    Still: the story as it was told by the banks didn’t convince their shareholders. They seem to put a lower value on the big banks than on private banks such as Julius Baer and Vontobel, with its focus on investment-related business.

    The two Swiss wealth management giants seem to have come around belatedly and now both simultaneously announced the launch of a push into the business with clients who have a little less money to invest.

    UBS, for instance, pledged to serve clients with assets of $500,000 to $5 million in a faster and more targeted fashion – and no longer according to the classic high net worth (HNW) approach. Credit Suisse will subsume the business with the not-so-rich in a sub-division. The banks say that this will help them respond better and more efficiently to demands in this segment.

    Two major areas of concern can be identified in the strategies and developments at the big banks, which prompted the repositioning. «Big banks realized that the focus on the UHNW business wasn’t enough to make successful and full use of their capacity,» said Robert Buess, financial services practice adviser at Oliver Wyman.

    With the focus on the richest clients, the erosion of margins accelerated despite the higher volumes of net new money.

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  • HSBC Brings Clients to Borneo

    HSBC Brings Clients to Borneo

    HSBC Jade invited clients to a trip traditionally reserved for senior staff and private banking clients to promote climate change awareness.

    The HSBC Sustainability Expedition was based in Malaysian Borneo where clients ventured into the Danum Valley’s rainforest encountering various animals including orangutans, Borneo pygmy elephants, flying squirrels and gibbons. The expedition was done in partnership with Earthwatch Institute and joined by science from the Royal Soci<ty South East Asia Rainforest Research Partnership (SEARRP).

    High net worth individuals in Asia are showing increased interest in sustainable living and incorporating ESG factors when investing, said Toby Chan, group head of Jade and Top Tier, HSBC retail banking and wealth management.

    We created the Sustainability Expedition for Jade to improve our clients’ knowledge of climate change and deepen understanding of sustainability through hands-on scientific research and expert conversations.

    The bank invited HSBC Jade clients from mainland China, Hong Kong and Singapore to engage in a myriad of activities including habitat assessment; the gathering of evidence on plant and animal life; and the planting of 80 Dipterocarp trees, a species prevalent in Borneo. In addition, the bank educated clients on sustainable investing and its role in transitioning to a low carbon economy.

    Five days in Danum Valley allow you to be really immersed in the whole ecosystem, the greenery, taking in what is living on earth, and how we should save our planet, said one Singapore client, according to the bank’s release.

    I will remember these particular actions on sustainability that I can do in my own ability – for example, decision making in terms of vendor purchasing, renovations, and any other matters where I’m responsible.

  • UOB Acquires Vietnam Asset Manager

    UOB Acquires Vietnam Asset Manager

    UOB Asset Management will acquire VAM Vietnam Fund Management Joint Stock Company, pending regulatory approval.

    UOB Asset Management has agreed to initially acquire 1.13 million ordinary shares from VAM Vietnam Fund Management Joint Stock Company from individual Nguyen Xuan Minh. The deal for the firm’s 24.53 percent shareholding is valued at VND113,680 million ($4.9 million), according to a report.After regulators approve the deal, another 3.47 million ordinary shares, or 75.47 percent of issued share capital, will be acquired by UOB Asset Management making VAM Vietnam Fund Management Joint Stock Company its subsidiary
    RegionalizationAccording to a release, the acquisition considered various factors including capital, net asset value and asset under management of VAM. The acquisition is also expected to further strengthen UOB Asset Management’s presence in Asia, in line with its regionalization plans. As of October 31 this year, VAM’s net asset value was around VND26 billion ($1.1 million) and it had assets under management of approximately VND114 billion ($4.9 million).
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